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About Funeral and Burial Pre-Planning

One way to plan a funeral in advance is to sign a formal contract called a "preneed funeral plan", where money is held in a trust, in an escrow account or paid through an insurance policy. Parts of or all of the funeral service and burial are designed in advance and prefunded in advance and the family has little to do but show up.

This type of planning has become very popular in recent years. A survey conducted by the AARP in 1999, found that two out of five people over age 50 had been approached to pre-purchase funerals and burial goods and services. An AARP survey in 1998 indicates that 32% of all Americans over age 50, roughly 21 million people, have prepaid some or all of their funeral and or burial expenses (but not necessarily through a formal preneed plan).

Breaking that down, about 25% of the over age 50 population have prepaid for their burials (cemetery plot, mausoleum or niche), 18% have prepaid for headstones, urns, caskets , grave liners or vaults, opening and closing of graves and so on and 13% have prepaid for goods or services from a funeral home or funeral director. The same article indicates that over $25 billion is being held in pre-need trust funds. Roughly another $25 billion is waiting to be paid out in life insurance benefits. Prepaid or preneed funerals and burials are big business.

Most states allow for using life insurance for funeral plans and a large number of states allow it for burial plans. In those states that allow insurance, three or four insurance companies have designed policies specifically to fund preneed contracts.

A standard contract is used with all funeral providers in each state that may or may not guarantee the cost of goods and services and does not require irrevocable assignment of the death benefit to the funeral provider. Where allowed, the contract will include burial services as well.

Request Assistance by filling out this Form

This form will go directly to the National Care Planning Council and not to a specific person or company. The Council will reply with any information they have available to help with your request.